The protracted legal dispute between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) is currently awaiting a Summary Judgment from the district court. Nevertheless, an attorney involved in the XRP lawsuit has hinted at a potential deadlock in the case.
XRP Sales After 2018 Not A Security？
Attorney Bill Morgan has pointed out that the US Securities and Exchange Commission's (SEC) expert witness has acknowledged that since mid-2018, the prices of Bitcoin and Ethereum, the two largest cryptocurrencies, can explain up to 90% of the price movement of Ripple's native token, XRP. However, the narrative that Ripple Labs' large holdings of XRP indicate centralization of the XRP ledger (XRPL) and make XRP a security continues to persist.
This implies that if the SEC's expert is correct, then one would have to assume that Ripple is somehow allowing BTC and ETH price movements to control the price of XRP in order to maintain control of the price as a centralized entity.
According to lawyer Bill Morgan, the narrative that Ripple Labs' high proportion of XRP holding means that XRP is a security persists, despite the US SEC's own expert admitting that Bitcoin and Ethereum price movements could explain as much as 90% of XRP's price movement since mid-2018. Morgan argued that it would be untenable to posit that Ripple is allowing XRP's price to be controlled by BTC and ETH price moves in order to maintain control of the price as a centralized actor, especially given that the majority of altcoins' prices are influenced in a similar manner.
Attorney Jeremy Hogan weighed in on this argument, suggesting that if the Judge in the XRP lawsuit announces a split decision, she could rule that Ripple's XRP sales since mid-2018 were not securities. Hogan supported this assertion with the SEC's claim that Ripple's actions had not had much effect on XRP's price since that point in time. This would mean that Ripple and its executives would pay a fine and could continue with their ongoing operations, while XRP would be the only crypto with clarity in the digital asset market.
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